The time is ripe to weed out the strong companies from the weak. Caesars belongs to the weak category, and its shares will follow the general market down, just at a faster pace. This is already happening. The S&P 500 topped on January 26th, and Caesars not much later on February 1st. The S&P is down 9% and Caesars 26%. Expect these trends to continue.

Why Caesars is falling specifically now is that it’s not profitable and prospects for growth are small. It’s still laden with too much debt despite casting off a ton of it to barely survive, and the only reason it was going up is because stocks in general were, too. That’s over now.

Before we get into Caesars specifically, here’s what I think happens from here in the short to medium term, meaning through the rest of 2018, and why. My belief is that US equities topped back in late January and we’re on our way down for as long as the Federal Reserve decides to stay out of the game. It’s been wild ups and downs daily now for the last two weeks. This up and down volatility seems to me to be nothing more than day traders and algorithms trying to take advantage of broad swings and squeeze each other. There isn’t significant new money flowing into the capital markets, and when this bull/bear day trading back and forth is done, we’re headed for another leg down. The only stocks that have a chance of bucking the trend are the really strong companies and Caesars is not one of them.

Dollar supply growth is very anemic and we are three weeks away from the peak for the next 4 to 5 months. Every year the dollar supply peaks on Tax Day and heads down from there until August/September. There will be no saving grace from the monetary side of things this year.